ACC: an Accident Waiting to Happen

Listener: 10 November, 2012.

Once upon a time, accident victims had to go through a long, complicated legal process to obtain compensation, with the possibility of an arbitrary and unfair outcome. In 1967 a Royal Commission chaired by Owen Woodhouse recommended an alternative that focused on remedies rather than causes and made accident prevention a priority. Today our Accident Compensation Corporation is the envy of much of the world (excluding lawyers who lost their outrageous fees from the old scheme). It is not perfect, of course – nothing is – but the imperfections gave politicians, pressured by special interests, an excuse for meddling.

Big business has grumbled about its cost, but that has been largely addressed by the Accredited Employer Scheme. More recently, the private insurance industry has wanted to be involved. A hyperactive minister began preparing the way for partial privatisation, but the insurance industry aside, there was no enthusiasm; it would have worsened the scheme. All the meddling has damaged the scheme’s reputation. What New Zealanders want after an accident is early rehabilitation and, where that is not possible, fair compensation. A system that minimises accidents would also be desirable. And no one wants to pay excessive levies or see anyone ripping the scheme off by making unreasonable demands.

What seems to have happened is cost minimisation has become more important than the fairness objective. I have friends – and have read of other people – who have been harassed by ACC until they become almost paranoid about its intentions, believing its aim is to shift them to the cheaper invalids benefit. That is despite, as far as I can judge, their being exactly the sort of unfortunates ACC should be supporting. After all, they paid their levies on that understanding. I readily accept there are some accident victims who should return to employment (perhaps with a top-up for the loss of earning power). But some can’t, regardless of the wishes of their case managers. I once accompanied a friend to a meeting with a case manager who was extremely tough, as one might have to be to identify skivers. It was a trial for the victim, but the assessor got it right in the end.

ACC employees as committed and professional as that case manager deserve admiration. But I have also come across inept ACC staff who should be transferred to the invalids benefit themselves. No matter how professional most might be, recent stories emerging from ACC are disturbing. Apparent casualness about privacy suggests a corporate culture in which accident victims are not respected. The fairness objective in the treatment of victims is contradicted by setting targets for case managers to get claimants off ACC’s books, whatever the justice of their claims. “Consultants” seem to be selected for their high rejection rate rather than for expert assessments. Sadly, the failures undermine the reputation of the many fine public servants who work for ACC.

Ultimately failure comes from the top. Too often ministers have lost sight of the Woodhouse principles. Their concerns seem to be cost-minimisation at the expense of fair treatment and private involvement at the cost of efficiency. As a result some genuine accident victims seem to get a poor deal. There would be few of us – excluding pressure groups pursuing their own narrow interests – who do not want a scheme that provides early rehabilitation, fair compensation and that prioritises prevention.